CROX Crocs Inc

Crocs, Inc. (NASDAQ: CROX) today reported the following record financial results for the third quarter ended September 30, 2006: Three months ended September 30, Nine months ended September 30, (In thousands, except per share data) 2006� 2005� 2006� 2005� Revenues $111,345� $38,294� $241,824� $75,022� Net income $21,526� $7,411� $43,633� $12,802� Net income per diluted share $0.53� $0.22� $1.10� $0.38� Revenues for the third quarter ended September 30, 2006 increased 192% to $111 million compared to $38 million for the third quarter ended September 30, 2005. Revenue for the nine months ended September 30, 2006 increased 223% to $242 million compared to $75 million for the nine months ended September 30, 2005. Net income for the third quarter ended September 30, 2006 was $22 million, or $0.53 per diluted share, compared to $7 million, or $0.22 per diluted share, for the same period in 2005. Net income for the nine months ended September 30, 2006 was $44 million, or $1.10 per diluted share, compared to $13 million, or $0.38 per diluted share, for the nine months ended September 30, 2005. Gross profit for the third quarter ended September 30, 2006 was $65 million, or 58.2% of revenues, compared to $22 million, or 57.9% of revenues for the third quarter ended September 30, 2005. Gross profit for the nine months ended September 30, 2006 was $136 million, or 56.0% of revenues, compared to $43.0 million, or 57.3% of revenues for the nine months ended September 30, 2005. Selling, general and administrative expenses for the third quarter ended September 30, 2006 was $33 million, or 30% of revenues, compared to $10 million, or 26% of revenues in the same period in 2005. Selling, general and administrative expenses for the nine months ended September 30, 2006 was $70 million, or 29% of revenues, compared to $23 million, or 31% of revenues in the comparable year ago period. �We are extremely pleased with our record third quarter performance which was once again fueled by growing demand for Crocs across the board,� commented, Ron Snyder, President and Chief Executive Officer of Crocs, Inc. �We continue to experience strong sell through of our core footwear offerings, while our new product launches, including the Mary Jane, Collegiate, and Disney, are outperforming our expectations. Internationally, the brand has increased retail traction which bodes well as we prepare to launch a full line of styles overseas next year.� For the fourth quarter ending December 31, 2006, the Company currently anticipates total revenues to be in the range of $92 to $95 million and projects its net income per diluted share to range from $0.40 to $0.43. For the fiscal year ending December 31, 2006, the Company currently anticipates total revenues to be in the range of $334 to $337 million and projects its net income per diluted share to range from $1.50 to $1.53. Mr. Snyder concluded, �The positive response to our entire line of footwear, both in the U.S. and abroad, gives us further confidence that our brand recognition is growing, our market share is expanding, and our products are among the most innovative and functional in the industry. While we have achieved significant sales and earnings year-to-date, we believe our prospects have never been brighter. Our entire team is energized and focused on capitalizing on the great number of compelling opportunities that we believe lie ahead.� Conference Call Information A conference call to discuss third quarter 2006 financial results is scheduled for today (Thursday, November 2) at 4:30 PM Eastern Time. A webcast of the call will take place simultaneously and can be accessed by clicking the �Investor Relations� link under the Company section on www.crocs.com or at www.viavid.net. To listen to the broadcast, your computer must have Windows Media Player installed. If you do not have Windows Media Player, go to the latter site prior to the call, where you can download the software for free. About Crocs, Inc. Crocs, Inc. is a rapidly growing designer, manufacturer and marketer of footwear for men, women and children under the crocs� brand. All of our footwear products incorporate our proprietary closed-cell resin material, which we believe represents a substantial innovation in footwear comfort and functionality. Our proprietary closed-cell resin, which we refer to as croslite� enables us to produce a soft and lightweight, non-marking, slip- and odor-resistant shoe. These unique properties make crocs� footwear ideal for casual wear, as well as for recreational uses such as boating, hiking, fishing and gardening, and have enabled us to successfully market our products to a broad range of consumers. Forward Looking Statements The matters regarding the future discussed in this news release include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including statements related to our future prospects and our expectations regarding our total revenues and net income per diluted share for the fourth quarter ending December 31, 2006. These statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. These risks and uncertainties include, but are not limited to, the following: our limited operating history; our significant recent expansion; changing fashion trends; our reliance on market acceptance of the small number of products we sell; our ability to develop and sell new products; our limited manufacturing capacity and distribution channels; our reliance on third party manufacturing and logistics providers for the production and distribution of our products; our reliance on a single-source supply for certain raw materials; our management and information systems infrastructure; our ability to obtain and protect intellectual property rights; the effect of competition in our industry; the effects of seasonality on our sales; our ability to attract, assimilate and retain management talent; and other factors described in our annual report on Form 10-K under the heading "Risk Factors," and our subsequent filings with the Securities and Exchange Commission. Readers are encouraged to review that section and all other disclosures appearing in our filings with the Securities and Exchange Commission. We do not undertake any obligation to update publicly any forward looking statement, including, without limitation, any estimate regarding revenues or earnings, whether as a result of the receipt of new information, future events, or otherwise. � Crocs, Inc. Consolidated Statements of Operations (In thousands, except share and per share data) (unaudited) � THREE MONTHS ENDED NINE MONTHS ENDED September 30, September 30, 2006� 2005� 2006� 2005� � Revenues $111,345� $38,294� $241,824� $75,022� Cost of Sales 46,521� 16,113� 106,348� 32,032� Gross Profit 64,824� 22,181� 135,476� 42,990� � � Selling, general and administrative expenses 33,344� 9,834� 70,345� 23,059� Income from operations 31,480� 12,347� 65,131� 19,931� � Interest expense 162� 178� 533� 380� Other expense (income), net: (657) 2� (1,310) 25� Income before income taxes 31,975� 12,167� 65,908� 19,526� � Income tax expense 10,449� 4,756� 22,275� 6,724� � Net income 21,526� 7,411� 43,633� 12,802� � Dividends on redeemable convertible preferred shares 0� 70� 33� 206� Net income attributable to common stockholders 21,526� 7,341� 43,600� 12,596� � Net income per share: Basic $0.56� $0.22� $1.19� $0.39� Diluted $0.53� $0.22� $1.10� $0.38� � Weighted average common shares: Basic 38,773,362� 25,712,040� 36,675,319� 25,329,984� Diluted 40,465,723� 33,615,781� 39,726,845� 33,358,633� � Crocs, Inc. Consolidated Balance Sheets (In thousands, except share and per share data) (unaudited) � September 30, December 31, 2006� 2005� ASSETS Current assets: Cash and cash equivalents $57,880� $ 4,787� Short-term investments 25,400� -� Accounts receivable, net 60,651� 17,641� Inventories, net 49,128� 28,494� Deferred tax assets 1,636� 1,939� Prepaid expenses and other current assets 10,233� 3,492� � Total current assets 204,928� 56,353� � Property and equipment, net 24,713� 14,765� Goodwill 350� 336� Other intangibles, net 8,106� 5,311� Deferred tax assets, net 1,532� 1,084� Other assets 902� 183� Total assets $ 240,531� $ 78,032� � LIABILITIES AND STOCKHOLDERS' EQUITY � Current liabilities: Accounts payable $ 30,459� $ 20,829� Accrued liabilities and other liabilities 21,716� 8,178� Income taxes payable 6,424� 8,697� Notes payable and current installments of long-term debt 817� 8,601� � Total current liabilities 59,416� 46,305� � Long-term debt 1,550� 3,422� Deferred tax liabilities 1,880� 1,772� Other liabilities 260� 319� � Total liabilities 63,106� 51,818� � Commitments and contingencies Redeemable common shares, 8,410,320 shares issued and outstanding at December 31, 2005 -� 1,800� Redeemable convertible preferred shares, par value $0.001 per share; 8,000,000 shares authorized 7,452,492 shares issued and outstanding in 2005 - preferences in liquidation of $5,500 � -� 5,500� � Stockholders' equity: Common shares, par value $0.001 per share; 125,000,000 and 25,000,000 shares authorized, 38,850,943 and 17,449,699 shares issued and outstanding 39� 17� Additional paid-in-capital 123,278� 13,976� Deferred compensation (7,146) (12,364) Retained earnings 60,297� 16,697� Accumulated other comprehensive income 957� 588� Total stockholders' equity 177,425� 18,914� � Total liabilities and stockholders' equity $ 240,531� $ 78,032� Crocs, Inc. (NASDAQ: CROX) today reported the following record financial results for the third quarter ended September 30, 2006: -0- *T Three months ended Nine months ended September 30, September 30, ------------------ ------------------ (In thousands, except per share data) 2006 2005 2006 2005 --------- -------- --------- -------- Revenues $111,345 $38,294 $241,824 $75,022 Net income $21,526 $7,411 $43,633 $12,802 Net income per diluted share $0.53 $0.22 $1.10 $0.38 *T Revenues for the third quarter ended September 30, 2006 increased 192% to $111 million compared to $38 million for the third quarter ended September 30, 2005. Revenue for the nine months ended September 30, 2006 increased 223% to $242 million compared to $75 million for the nine months ended September 30, 2005. Net income for the third quarter ended September 30, 2006 was $22 million, or $0.53 per diluted share, compared to $7 million, or $0.22 per diluted share, for the same period in 2005. Net income for the nine months ended September 30, 2006 was $44 million, or $1.10 per diluted share, compared to $13 million, or $0.38 per diluted share, for the nine months ended September 30, 2005. Gross profit for the third quarter ended September 30, 2006 was $65 million, or 58.2% of revenues, compared to $22 million, or 57.9% of revenues for the third quarter ended September 30, 2005. Gross profit for the nine months ended September 30, 2006 was $136 million, or 56.0% of revenues, compared to $43.0 million, or 57.3% of revenues for the nine months ended September 30, 2005. Selling, general and administrative expenses for the third quarter ended September 30, 2006 was $33 million, or 30% of revenues, compared to $10 million, or 26% of revenues in the same period in 2005. Selling, general and administrative expenses for the nine months ended September 30, 2006 was $70 million, or 29% of revenues, compared to $23 million, or 31% of revenues in the comparable year ago period. "We are extremely pleased with our record third quarter performance which was once again fueled by growing demand for Crocs across the board," commented, Ron Snyder, President and Chief Executive Officer of Crocs, Inc. "We continue to experience strong sell through of our core footwear offerings, while our new product launches, including the Mary Jane, Collegiate, and Disney, are outperforming our expectations. Internationally, the brand has increased retail traction which bodes well as we prepare to launch a full line of styles overseas next year." For the fourth quarter ending December 31, 2006, the Company currently anticipates total revenues to be in the range of $92 to $95 million and projects its net income per diluted share to range from $0.40 to $0.43. For the fiscal year ending December 31, 2006, the Company currently anticipates total revenues to be in the range of $334 to $337 million and projects its net income per diluted share to range from $1.50 to $1.53. Mr. Snyder concluded, "The positive response to our entire line of footwear, both in the U.S. and abroad, gives us further confidence that our brand recognition is growing, our market share is expanding, and our products are among the most innovative and functional in the industry. While we have achieved significant sales and earnings year-to-date, we believe our prospects have never been brighter. Our entire team is energized and focused on capitalizing on the great number of compelling opportunities that we believe lie ahead." Conference Call Information A conference call to discuss third quarter 2006 financial results is scheduled for today (Thursday, November 2) at 4:30 PM Eastern Time. A webcast of the call will take place simultaneously and can be accessed by clicking the 'Investor Relations' link under the Company section on www.crocs.com or at www.viavid.net. To listen to the broadcast, your computer must have Windows Media Player installed. If you do not have Windows Media Player, go to the latter site prior to the call, where you can download the software for free. About Crocs, Inc. Crocs, Inc. is a rapidly growing designer, manufacturer and marketer of footwear for men, women and children under the crocs(TM) brand. All of our footwear products incorporate our proprietary closed-cell resin material, which we believe represents a substantial innovation in footwear comfort and functionality. Our proprietary closed-cell resin, which we refer to as croslite(TM) enables us to produce a soft and lightweight, non-marking, slip- and odor-resistant shoe. These unique properties make crocs(TM) footwear ideal for casual wear, as well as for recreational uses such as boating, hiking, fishing and gardening, and have enabled us to successfully market our products to a broad range of consumers. Forward Looking Statements The matters regarding the future discussed in this news release include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including statements related to our future prospects and our expectations regarding our total revenues and net income per diluted share for the fourth quarter ending December 31, 2006. These statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. These risks and uncertainties include, but are not limited to, the following: our limited operating history; our significant recent expansion; changing fashion trends; our reliance on market acceptance of the small number of products we sell; our ability to develop and sell new products; our limited manufacturing capacity and distribution channels; our reliance on third party manufacturing and logistics providers for the production and distribution of our products; our reliance on a single-source supply for certain raw materials; our management and information systems infrastructure; our ability to obtain and protect intellectual property rights; the effect of competition in our industry; the effects of seasonality on our sales; our ability to attract, assimilate and retain management talent; and other factors described in our annual report on Form 10-K under the heading "Risk Factors," and our subsequent filings with the Securities and Exchange Commission. Readers are encouraged to review that section and all other disclosures appearing in our filings with the Securities and Exchange Commission. We do not undertake any obligation to update publicly any forward looking statement, including, without limitation, any estimate regarding revenues or earnings, whether as a result of the receipt of new information, future events, or otherwise. -0- *T Crocs, Inc. Consolidated Statements of Operations (In thousands, except share and per share data) (unaudited) THREE MONTHS ENDED NINE MONTHS ENDED September 30, September 30, 2006 2005 2006 2005 Revenues $111,345 $38,294 $241,824 $75,022 Cost of Sales 46,521 16,113 106,348 32,032 Gross Profit 64,824 22,181 135,476 42,990 Selling, general and administrative expenses 33,344 9,834 70,345 23,059 Income from operations 31,480 12,347 65,131 19,931 Interest expense 162 178 533 380 Other expense (income), net: (657) 2 (1,310) 25 Income before income taxes 31,975 12,167 65,908 19,526 Income tax expense 10,449 4,756 22,275 6,724 Net income 21,526 7,411 43,633 12,802 Dividends on redeemable convertible preferred shares 0 70 33 206 Net income attributable to common stockholders 21,526 7,341 43,600 12,596 Net income per share: Basic $0.56 $0.22 $1.19 $0.39 Diluted $0.53 $0.22 $1.10 $0.38 Weighted average common shares: Basic 38,773,362 25,712,040 36,675,319 25,329,984 Diluted 40,465,723 33,615,781 39,726,845 33,358,633 *T -0- *T Crocs, Inc. Consolidated Balance Sheets (In thousands, except share and per share data) (unaudited) September 30, December 31, 2006 2005 ASSETS Current assets: Cash and cash equivalents $57,880 $ 4,787 Short-term investments 25,400 - Accounts receivable, net 60,651 17,641 Inventories, net 49,128 28,494 Deferred tax assets 1,636 1,939 Prepaid expenses and other current assets 10,233 3,492 Total current assets 204,928 56,353 Property and equipment, net 24,713 14,765 Goodwill 350 336 Other intangibles, net 8,106 5,311 Deferred tax assets, net 1,532 1,084 Other assets 902 183 Total assets $240,531 $ 78,032 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 30,459 $ 20,829 Accrued liabilities and other liabilities 21,716 8,178 Income taxes payable 6,424 8,697 Notes payable and current installments of long-term debt 817 8,601 Total current liabilities 59,416 46,305 Long-term debt 1,550 3,422 Deferred tax liabilities 1,880 1,772 Other liabilities 260 319 Total liabilities 63,106 51,818 Commitments and contingencies Redeemable common shares, 8,410,320 shares issued and outstanding at December 31, 2005 - 1,800 Redeemable convertible preferred shares, par value $0.001 per share; 8,000,000 shares authorized 7,452,492 shares issued and outstanding in 2005 - preferences in liquidation of $5,500 - 5,500 Stockholders' equity: Common shares, par value $0.001 per share; 125,000,000 and 25,000,000 shares authorized, 38,850,943 and 17,449,699 shares issued and outstanding 39 17 Additional paid-in-capital 123,278 13,976 Deferred compensation (7,146) (12,364) Retained earnings 60,297 16,697 Accumulated other comprehensive income 957 588 Total stockholders' equity 177,425 18,914 Total liabilities and stockholders' equity $240,531 $ 78,032 *T